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China's infrastructure diplomacy takes a beating in Asian elections
September 30, 2018
BANGKOK -- China's bets on friendly leaders around Asia continue to backfire, with the shock election defeat of Maldivian President Abdulla Yameen last Sunday casting fresh doubt on Beijing's strategy for building regional influence.
Former Maldivian President Mohamed Nasheed, the Indian Ocean archipelago's first democratically elected leader and an ally of new President-elect Ibrahim Mohamed Solih, set the tone this week by questioning the "business sense" of Chinese-funded infrastructure projects under the Belt and Road Initiative.
"You cannot foist infeasible projects on developing countries," he told The Hindu, an Indian daily. "We all love a bridge, but please don't push it on us."
Nasheed was alluding to the $210 million Chinese-Maldives Friendship Bridge, which opened in late August. The opening was supposed to help Yameen woo voters by showcasing his record of economic development, supported by Chinese cash.
Before the interview, Nasheed had already said he wants the new government to review all Chinese projects, a large chunk of which are funded through loans to the tune of $1.5 billion. The Maldivian economy is only worth $3.6 billion.
Beijing has fired back to defend its interests in the tiny island country, which despite its size is also being courted by India and Western governments.
"Whether the cooperation between the Maldives and China can work out or bring benefits to the two countries is all up to the people of the two countries," Chinese Foreign Ministry spokesman Geng Shuang said on Wednesday. "It cannot be smeared by certain individuals."
Geng added that China would "continue our cooperation on the basis of equality and mutual benefit, and abide by market rules and regulations." Then he made a veiled threat that Beijing would "oppose if certain people harm China's interests."
These Chinese jitters are not new. In May, another pro-China incumbent, Malaysian Prime Minister Najib Razak, was also unexpectedly trounced at the polls, raising questions about the fate of Chinese-backed projects.
New Prime Minister Mahathir Mohamad, the veteran politician who returned to lead the anti-Najib alliance to victory, has been more direct than Nasheed about freezing Chinese infrastructure projects. In his crosshairs: the $20 billion East Coast Rail Link and two natural gas pipelines worth $2.3 billion.
This, in turn, had echoes of China's experience in Sri Lanka, where it had used economic largesse to woo former President Mahinda Rajapaksa, who had autocratic tendencies like Yameen.
Sri Lanka's current governing alliance, which defeated Rajapaksa in an unexpected poll reversal, targeted multibillion-dollar Chinese investments on the South Asian island for review, fearing a foreign debt crisis stemming from Chinese loans.
Analysts say China cannot easily distance itself from the pro-Beijing incumbents who have drawn so much ire. Voters, they note, have demonstrated their anger at corrupt governments propped up by money flowing in from the world's No. 2 economy.
Patrick Mendis, a Chinese international affairs scholar at Harvard University, said Beijing stretches credulity when it says it pursues a foreign policy of "noninterference."
"The actions and evidence from these Asian countries have shown otherwise, which the West calls 'sharp power,'" Mendis told the Nikkei Asian Review.
"The shortsightedness and miscalculation in Beijing's leadership have shown that money can't buy freedom and the will of the people," he added. "Freedom is a more viable force to counter corruption and to bring about transparency and accountability to those who governed them."
Annual reports by Transparency International, the global anti-graft watchdog, shed light on the scale of corruption under the three pro-China governments that have been vanquished at the polls.
In its Corruption Perceptions Index released earlier this year, Maldives was named among the "worst regional offenders" as of 2017 -- Yameen's fourth year in power. It was ranked 112 out of 180 countries surveyed for graft.
Malaysia under Najib also fared poorly in the 2017 ranking, dropping to 62 from 55 the year before. The massive corruption scandal surrounding state fund 1Malaysia Development Berhad, with Najib's alleged involvement, resulted in the country's worst ranking in five years.
China would be wise to take all this as a cautionary tale, suggested Ilham Mohamad, Transparency International's regional coordinator for South Asia. "The recent elections in Sri Lanka, the Maldives, Malaysia, and even Pakistan have shown that people will mobilize against governments they perceive as corrupt."
A "positive consequence," he said, is that it could prompt investor countries like China to adopt "more vigorous foreign bribery policies as a step toward investment risk mitigation."
The Maldives offers China a chance to explore this route. "We believe that Chinese companies may have been victims of corruption and fraud perpetrated by Maldivian officials," Ahmed Naseem, a former Maldivian foreign minister, told Nikkei. "At the moment, there is almost no transparency on any of [the Chinese] projects."
Naseem said it is worth taking a closer look. "We don't know how much they cost; we don't know what the terms are; we don't know the extent of corruption from the Maldives side," he said. "President Xi Jinping has taken a very strong line on corruption in China, which we applaud. In that spirit, we need to look at the investments in the Maldives in forensic details."
September 30, 2018
BANGKOK -- China's bets on friendly leaders around Asia continue to backfire, with the shock election defeat of Maldivian President Abdulla Yameen last Sunday casting fresh doubt on Beijing's strategy for building regional influence.
Former Maldivian President Mohamed Nasheed, the Indian Ocean archipelago's first democratically elected leader and an ally of new President-elect Ibrahim Mohamed Solih, set the tone this week by questioning the "business sense" of Chinese-funded infrastructure projects under the Belt and Road Initiative.
"You cannot foist infeasible projects on developing countries," he told The Hindu, an Indian daily. "We all love a bridge, but please don't push it on us."
Nasheed was alluding to the $210 million Chinese-Maldives Friendship Bridge, which opened in late August. The opening was supposed to help Yameen woo voters by showcasing his record of economic development, supported by Chinese cash.
Before the interview, Nasheed had already said he wants the new government to review all Chinese projects, a large chunk of which are funded through loans to the tune of $1.5 billion. The Maldivian economy is only worth $3.6 billion.
Beijing has fired back to defend its interests in the tiny island country, which despite its size is also being courted by India and Western governments.
"Whether the cooperation between the Maldives and China can work out or bring benefits to the two countries is all up to the people of the two countries," Chinese Foreign Ministry spokesman Geng Shuang said on Wednesday. "It cannot be smeared by certain individuals."
Geng added that China would "continue our cooperation on the basis of equality and mutual benefit, and abide by market rules and regulations." Then he made a veiled threat that Beijing would "oppose if certain people harm China's interests."
These Chinese jitters are not new. In May, another pro-China incumbent, Malaysian Prime Minister Najib Razak, was also unexpectedly trounced at the polls, raising questions about the fate of Chinese-backed projects.
New Prime Minister Mahathir Mohamad, the veteran politician who returned to lead the anti-Najib alliance to victory, has been more direct than Nasheed about freezing Chinese infrastructure projects. In his crosshairs: the $20 billion East Coast Rail Link and two natural gas pipelines worth $2.3 billion.
This, in turn, had echoes of China's experience in Sri Lanka, where it had used economic largesse to woo former President Mahinda Rajapaksa, who had autocratic tendencies like Yameen.
Sri Lanka's current governing alliance, which defeated Rajapaksa in an unexpected poll reversal, targeted multibillion-dollar Chinese investments on the South Asian island for review, fearing a foreign debt crisis stemming from Chinese loans.
Analysts say China cannot easily distance itself from the pro-Beijing incumbents who have drawn so much ire. Voters, they note, have demonstrated their anger at corrupt governments propped up by money flowing in from the world's No. 2 economy.
Patrick Mendis, a Chinese international affairs scholar at Harvard University, said Beijing stretches credulity when it says it pursues a foreign policy of "noninterference."
"The actions and evidence from these Asian countries have shown otherwise, which the West calls 'sharp power,'" Mendis told the Nikkei Asian Review.
"The shortsightedness and miscalculation in Beijing's leadership have shown that money can't buy freedom and the will of the people," he added. "Freedom is a more viable force to counter corruption and to bring about transparency and accountability to those who governed them."
Annual reports by Transparency International, the global anti-graft watchdog, shed light on the scale of corruption under the three pro-China governments that have been vanquished at the polls.
In its Corruption Perceptions Index released earlier this year, Maldives was named among the "worst regional offenders" as of 2017 -- Yameen's fourth year in power. It was ranked 112 out of 180 countries surveyed for graft.
Malaysia under Najib also fared poorly in the 2017 ranking, dropping to 62 from 55 the year before. The massive corruption scandal surrounding state fund 1Malaysia Development Berhad, with Najib's alleged involvement, resulted in the country's worst ranking in five years.
China would be wise to take all this as a cautionary tale, suggested Ilham Mohamad, Transparency International's regional coordinator for South Asia. "The recent elections in Sri Lanka, the Maldives, Malaysia, and even Pakistan have shown that people will mobilize against governments they perceive as corrupt."
A "positive consequence," he said, is that it could prompt investor countries like China to adopt "more vigorous foreign bribery policies as a step toward investment risk mitigation."
The Maldives offers China a chance to explore this route. "We believe that Chinese companies may have been victims of corruption and fraud perpetrated by Maldivian officials," Ahmed Naseem, a former Maldivian foreign minister, told Nikkei. "At the moment, there is almost no transparency on any of [the Chinese] projects."
Naseem said it is worth taking a closer look. "We don't know how much they cost; we don't know what the terms are; we don't know the extent of corruption from the Maldives side," he said. "President Xi Jinping has taken a very strong line on corruption in China, which we applaud. In that spirit, we need to look at the investments in the Maldives in forensic details."
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